India is under pressure at the WTO to give its consent for inclusion of the proposed China-led investment facilitation for development (IFD) pact in the formal WTO framework as a plurilateral agreement (endorsed by some of the members), but it is refusing to give in, sources said.  

At this week’s meeting of the WTO’S General Council–the highest-level decision-making body in the WTO that meets on a regular basis during the year– New Delhi continued to oppose the move stating that investment is not an issue for discussion at the WTO, sources said.

“India has maintained its position on the issue, as outlined at the WTO 13th Ministerial Conference (MC13) in Abu Dhabi earlier this year, against incorporating investment facilitation and other plurilaterals in the WTO framework. It said that investment is not an issue for discussion at the WTO,” a trade official tracking the matter told businessline.

At the WTO MC13, a joint ministerial declaration was issued by Trade Ministers from 123 WTO member countries, including the EU, finalising the IFD pact, and these countries wanted it to be formally brought into the WTO as a plurilateral agreement.

As a plurilateral pact, it would have been binding on only its signatories and not on non-members which include India, South Africa, the US and some others.

“India and South Africa, played a key role in blocking the move as they pointed out that there was no exclusive consensus to add the proposed IFD as a plurilateral agreement between the member countries already on board. They stressed that given the lack of exclusive consensus, this was not a matter for the MC13 agenda and should be discussed at the General Council,” another source pointed out.

India stayed out of the IFD as it was concerned that some of its provisions would put the onus on the government to consult investors on policy matters which could encroach on its policy space, a government source had earlier explained.

Further, since investment is not a trade issue and it had been decided in earlier Ministerials that it should be kept out of the WTO, it should not be made part of the formal WTO framework as a plurilateral agreement.

“India maintained its position and shared its concerns on IFD at the General Council while many other members, including the EU, made forceful arguments for its adoption,” the trade official said.

The key pillars of the IFD Agreement are its sections on transparency of investment measures; streamlining and speeding-up investment-related authorisations procedures; enhancing international cooperation, information sharing, and the exchange of best practices; and sustainable investment, according to the proponents 

“Preliminary studies show that the IFD Agreement will benefit directly or indirectly all WTO members, especially developing and least-developed ones…This is why we hope that a decision on this item can be made soon,” the EU noted at the GC meeting.